Fare increases an option as Metro looks at rail funding

CHRIS MORAN, Copyright 2010 Houston Chronicle

Published
5:30 am CDT, Wednesday, July 21, 2010

Although leaders of the region's transit agency are confident that they will secure $900 million in federal funding to build more light rail lines in Houston, they have begun discussing fare increases and advertising on buses as ways to pay for rail if they do not get the money.

Acting Metro CEO George Greanias did not rule out a fare increase as part of the annual budget the board must adopt in September and said such a plan could emerge as early as next month.

No proposal is in the works, however, Greanias emphasized. Still only 10 weeks into his job as the area's transit boss, Greanias said the organization's brain trust is considering all possibilities to meet the challenges of the next two fiscal years, from reducing routes to delaying construction to raising fares to selling station naming rights to doing none of those things.

"All issues are on the table, but nothing is being promoted," Greanias said. Planners need to examine the possible impacts on ridership, for example, before formally proposing hiking the price of a rail or bus ride. Metro last raised fares in November 2008.

Metro plans to build five light rail lines in the next four years. It is awaiting $900 million in grants from the Federal Transit Administration for its North and Southeast rail lines.

That funding is in jeopardy while the Federal Transit Administration investigates whether Metro has violated requirements that federal money be spent on American-made products. At issue is whether federal "Buy America" rules permit the assembly of two prototype rail cars in Spain. Metro has proposed purchasing those cars with local funds and running them on rail routes paid for with local money. An additional 103 cars to be purchased under a separate contract with the Spanish vendor would be built in the United States.

Metro officials had expected the grants to be approved by early this year. As the months pass, Metro has revised its estimate and now hopes for approval by the end of September, followed by review by the U.S. Department of Transportation, the budget office and Congress.